Govt should pay for Marlborough road rebuilds
15 September 2022
by Chris Leitch, Leader
Social Credit is calling on the government to come up with the money to fix the Marlborough roads seriously damaged by the recent devastating floods.
Grant Robertson's claim today that his government’s good financial management is responsible for positive GDP growth in the last quarter means he has more tax revenue to spend.
Coupled with the rise in prices which automatically delivers him a significant increase in GST, that means he can well afford to stump up with several million to ensure the Marlborough District roads get rebuilt.
Council can get on with rebuilding the damaged roads without that burden falling on ratepayers.
He could, of course, not dip into that extra tax revenue at all but instead follow the advice of Treasury and the Reserve Bank and direct fund that investment in Marlborough by a transfer of funds from the Bank into the government's account with the Bank as set out in the aide memoir written by the Treasury and Reserve Bank to Grant Robertson in May 2020.
“Monetary Financing involves financing a fiscal deficit not by the issue of interest-bearing debt, but by an increase in the monetary base.”
“It can meet the specific funding needs of the government at lower initial cost and with greater certainty than Quantitative Easing.”
Additionally the government is paying around $5 billion every year in interest to commercial banks on its borrowing when it could access much of its funding needs from its own bank, the Reserve Bank - at zero interest -
If it took that advice it would free up massive amounts of taxpayer money for Marlborough, Ashburton and Northland and still leave billions to go into hospitals, schools, and poverty reduction.
The government is therefore paying out $5 billion every year of taxpayer money that it doesn’t need to.
Clearly Grant Robertson favours the interests of wealthy commercial bank shareholders over those of kiwis needing the services rebuilt in the regions.
That situation would be just as bad under National which is wedded to the same economic philosophy.
A new economic approach is required that puts kiwis first.
Attached – Aide Memoir - Treasury and Reserve Bank to Grant Robertson, May 2020. Download here.